It’s fascinating how regularly the beloved underdogs of the tech world rise to become monopolistic titans, betray (or are perceived as betraying) their original ethos, and are turned on and repudiated by the technorati. I’ve seen it happen three and a half times in my life: the monopolistic phase for Microsoft, the rise and repudiation of Google and Facebook, and something along those lines for Apple (though they’re somewhat different, probably because of very snide perception-management).
I’m not saying it’s wrong (I actually think it’s fair), it’s just that the regularity is amusing. When Microsoft was represented by a Locutus-ified Bill Gates on Slashdot two decades ago, “do no evil” open-source champion Google could do no wrong,
I was about to write “oh, how far the mighty have fallen!” but upon closer consideration that would be the wrong epithet. It’s precisely because it has not fallen, and because it has become too mighty, that is now viewed with ever-growing suspicion.
The vaunted free market that so enamours Silicon Valley and digital utopianists cannot avoid corrupting these companies’ moral cores, apparently. Quite the opposite of the declared ethos.
EDIT: The cherished underdogs of today, if they do not succumb, regularly become the maligned monsters of tomorrow. It’s almost as if there’s something built into the system that corrupts them...
If a company is a public company, it can't help BUT be evil.
Corollaries and commentary:
1) Evil arises from public companies' duty to generate as much money as possible for their shareholders. Private companies have more freedom to make less money and to not be evil--or even to choose to "die" while retaining their honor and that of their members.
2) A public company might not be evil now, but if it keeps growing, it will eventually be evil.
3) This applies regardless of the initial size, values, and idealism of the company; the choice to be a public company seals its fate.
I think the "borg" is actually a more fitting analogy. They aren't actually evil, it's just that their only purpose is perceived as evil even though they are really neutral, they don't care if you want to join them or not (e.g. C corporations have only one purpose, which is to maximize shareholder profit.)
Also, there is another choice, which is becoming a benefit corporation. Google didn't choose this, likely because it means your shareholders are probably going to be fewer as you aren't primarily serving them. So really, the founders betrayed their values by wanting to become huge which beheld them to the "shareholder value at all costs" mandate.
So this was a long winded way to say that a really idealistic software company should start out as a b corp.
This is a good point, but I don't know if the public/private distinction is that relevant. Lots of private companies still take funding from VC's or other investors, who still generally demand a profit-at-any-cost approach. Uber is an easy example of this.
> If a company is a public company, it can't help BUT be evil...[this arises from the] duty to generate as much money as possible for their shareholders.
That's clearly a very undesirable result. I do hold out hope that one day either alternative ownership styles (e.g. mutuals or cooperatives) or reform that gives other stakeholders a seats in corporate boards will mitigate the problem.
The article as a whole is about Unilever betraying the corporate values after buying the company and whether the sale was really forced, but that particular section goes into detail why what you're saying isn't universally true.
The TL;DR is that a number of state laws (and possibly higher level, hadn't finished researching) specifically carve out room for companies to consider corporate values over investor money in fulfilling fiduciary duty. They establish multiple classes of people--including customers--to be constituencies being served, not just investors.
So you can absolutely incorporate in a way that will run your company to make as much money as possible for public shareholders within the bounds of what makes the company that company, including value systems. If a company betrays their stated values, that's absolutely on that company, not an inevitable fate for going public.
Relevant quote:
Most state legislatures have resisted the tenets of Dodge v. Ford by enacting statutes that expressly authorize corporate directors to look beyond shareholder wealth maximization. Vermont enacted one, nicknamed “the Ben & Jerry’s law,” after the company had successfully lobbied Vermont’s legislature. Vermont’s “other constituency” statute, as these laws are called, is illustrative: It provides that when directors make decisions they may consider such matters as “the interests of the corporation’s employees, suppliers, creditors, and customers; the economy of the state, region, and nation; [and] community and societal considerations, including those of any community in which any offices or facilities of the corporation are located.” State statutes also give corporations wide latitude to donate profits to charities.
Edit: having problems finding a clear list, but looks like ~35 states have them, including Delaware. California, interestingly, does not have one. Looks like one made it through legislature years ago when these were all popping up, but Schwarzenegger vetoed it.
> The vaunted free market that so enamours Silicon Valley and digital utopianists cannot avoid corrupting these companies’ moral cores, apparently. Quite the opposite of the declared ethos.
It's a function of incentives, large organizations, moral hazards, and the expectation of perpetual growth. And it will probably reboot, repeatedly crashing, over and over until the end of time.
"Don't be evil." Maybe "Don't pursue exponential growth indefinitely?"
Part of this is unintended consequences. Previous rulings have said that the board and company must prioritize shareholder benefit to avoid them focusing on their own personal enrichment. At the same time, this pursuit of growth is why the stock market is growing 25%+ in the good years which everyone loves seeing in their 401K and IRA statements.
We really need to encourage more B corporations both in the founding and running and also by eschewing public company stocks that are not.
It's a common belief, that boards have encouraged, that they are "required" to act in the best interests of shareholders by maximizing share value. This is wrong on both accounts. Boards are only required to consider the direct impact on shareholders when deciding on events that would directly impact them, ie mergers and acquisitions. The rest of the time they can do as they please shareholders be damned, and there is a ton of case law supporting that.
The OG battle of Dodge v Ford was about profit margins and sort-of about dividends. It's hard not to feel that the case law is muddy on the subject given that's where its roots lay.
I’m curious if “free markets” are really driving these companies towards endless growth every quarter or if it’s the result of the sophisticated capital system Wall St pioneered in the late 1800s.
If anything it’s a function of American style public markets and I’m not going for a no true Scotsman argument but rather it’s important to look at the whole system in place rather than dismissive politicized labels.
This skewed incentive system then gets combined with another common problem and made far worse. Public stock market corporations are not the only ones who decline in caring about their core values. This happens to many actual public government agencies, non profits, or any large organization when later generations of executive take over...people who weren’t there for the original vision. These people care more about the organization itself than they do about what value the organization delivers to society.
In public stock companies this usually means the people who then start to only care about the accountants demands (tons of CEOs are accountants, few are engineers) and what public investors think and feel (their moods often determine prices as much as reality) and most importantly not caring first about their value to customers... which had created the whole empire [1]. Ala the Iron rule of bureaucracy [2].
[1] GE is the perfect example of this, where the finance/Wall St guys took over, created the highest growth rates, then nearly destroyed the company in pursuit of growth, and changed the whole company away from their core engineering business and nearly destroyed it. They are now slowly slimming the Capital division and retiring to making things
FWIW, the CEO of Rogers (large Canadian telecom and media corp) was an engineer by training. It's not much different. (Though I'll give him points for pushing for improved customer focus, while focusing on growing the network infrastructure, and for choosing Ericsson equipment primarily) But still. They're not well-liked in Canada—though maybe less hated currently with the recent heat on Bell.
Yeah that's more of a representative example of the culture of public companies (accountants and finance running the show) rather than engineer-CEOs being some panacea solution.
Individuals and leaders within the company help but they're all playing the same game in a culture which values the organization for the organizations sake combined with a system that forces companies to be laser focused on a single metric... when companies in a typical marketplace are a collection of metrics/incentives.
Yes you're spot on, even if this morning every single employee working at Google is highly ethical and working towards bettering humanity, it's still not going to be true tomorrow.
The phrase in the article that really popped out at me was "no one is truly at the helm". When a mega-corporation gets this massive and powerful it's not going to be possible to account for everyone in the building and all the bad decisions that can occur.
What did Apple betray? Wasn’t it always a walled garden, enforcing things are done their way? If anything, it’s been moving more and more pro-privacy recently...
Apple's case is slightly more complicated. From 1995-2004 I used Linux, from 2004-2018 I used Mac (whole ecosystem), from 2018 onwards I'm back to Linux.
To be honest my reasons are: I really just think Tim Cook has little to no vision and all their products are showing the effects of "bozo explosion".
Any organization that doubles, triples, or quadruples in size winds up being a giant host to parasitic employees (middle manager bozos, usually), whose basic motive is (a) do little work, (b) get paid. The real world effects is the company stops being able to make decisions and continues to double-down on mistakes (removing headphone jacks to force consumers into buying your proprietary 'ear pods'). All those "one time tricks" to boost revenue eventually run out...ask Balmer.
For me, it’s about weighing your options carefully and accepting the things you can’t change. I tried to move away from the Windows ecosystem to Linux but quickly found it lacking in the areas that were very important to me, namely music production. I really love Linux and still use it for certain things (and I even switched my daughter who’s now in HS to it and she loves it).
There is certainly a duality to the walled garden paradigm - on the one hand, a very controlled environment presumably ensures quality and reliability, however it also creates an environment vulnerable to abuse, such as fixed pricing schemes. All Apple users have to accept the fact that they can’t upgrade their hardware, ever. And because Apple ultimately has control over all aspects to f their ecosystem, an OS upgrade can and often will hose your carefully configured rig. Like MS, Apple is not concerned with the hapiness of a particular segment of their user base; No, they care about pushing new features and fixing security vulnerabilities. They are just like any other big company that cares about their bottom line. I chose to accept this as the lesser of the two evils. Perhaps at some point in the future, a company will come along that actually cares about users.
Philosophyally, there is not much difference between Apple and MS, but Apple at the moment just happens to have an ecosystem that favors artists, while Linux is like the deadbeat dad that shows up
once in a while. But blaming “Linux” for lack of artist support is also unfair because Linux is not a single entity.
I make my choices with eyes wide open. I may hate
some aspects of my choices, but I am not forced into them.
Are you sure Apple's products teams grew? AFAIK these were quite small and I did not hear anyone talking about them growing.
Going back to Linux because Apple has no vision—I'd say this is another level of ironic.
Being a part of the Apple ecosystem is, in large part, paying into a future vision. Without this vision, what's the point of spending top dollar to be a part of something utterly uncertain?
Linux is a much much lower cost of entry - there's no grand vision expectation.
You can be an Apple user without being a part of the Apple ecosystem.
I've been an Android user since forever but I had to switch to iPhone X to dogfood my app. I "switched without switching" -- my photos are still saved to Google Photos, my contacts are synched with Google Contacts, etc.
I'm perfectly fine after the switch. All my mobile workflows are intact. When it's time to switch back to Android, I'm sure I'll be able to switch without any major problems (except for one thing -- I'll likely miss the build quality of iPhone X).
You buy Apple products because you think their products are the best. It's fine if you don't, most people seem to think so which is why they have overwhelming share of high end products.
You're not paying for a future vision at all. That doesn't make any sense because they don't tell you what's coming in the future and actively try to prevent people from finding out.
1) If you use iMessage, you cannot switch out of it without losing access to any group messages you were in before. Any messages other iMessage users try to send you will simply be silently deleted. I believe this violates federal telecommunications law.
2) Apple prohibits selling virtual goods in iOS apps, unless you give them a 30% cut. I believe this is racketeering.
Obviously there is room for legal debate here, but I think these are anti-competitive choices Apple has made, which weren't present in iPhone 1.
They are able to continue to do these things because the vast majority of iPhone customers don't realize they are happening. But they maintain platform lock-in.
It always reminded me of the standard trick of new rulers granting favors to gain popular support. Caligula is especially famous for burning the treason records of his predecessor and giving out bonuses and calling back exiles. Caesar did similar things.
When a company is new they have to gain support. They talk about changing the world and often focus on things like employee happiness.
But ultimately it all comes down to the shareholders, and expenses have to be tightened once it no longer makes sense to pay a premium for good will.
Maybe something corrupts the founders. But it's also possible the founders planned it all along. Certainly it seems like my the earliest investors are aware of this game.
>When Microsoft was represented by a Locutus-ified Bill Gates on Slashdot two decades ago, “do no evil” open-source champion Google could do no wrong,
That does NOT match my recollection of Google's early days. Among my immediate network it was pretty common to view Google with a LOT of trepidation given the implied dangers of having so much data.
OTOH, nobody I know in real life has felt this way about Apple, largely because you can avoid their power if you decide their approach doesn't work for you.
I think there was a lot of naïve belief that with a love of open standards and "Do No Evil" as unofficial mascot, even with all that data they might be reasonable "overlords".
I know in some of my circles we didn't start to feel trepidation until they acquired dot-com era mustachioed villains DoubleClick, and certainly the point of no-return for me was G+ killing Reader and XMPP access in Talk.
Apple's brand of 'evil' was the capricious rules of the App Store walled garden and Apple's rent seeking on iPhone/iPad accessories. Then there was the whole wage suppression thing.
At least with Apple, they never seemed terribly interested in world domination.
Whether or not the rules in the App Store are "capricious" is widely debated, but it's probably safe to say that they're coming out looking pretty good vis a vis malware and end-user experience as a result.
>Apple's rent seeking on iPhone/iPad accessories.
People who dislike Apple love to say things like this, but I've never really seen anything that qualifies. Is Apple stuff more expensive? Yes. But you tend to get more for your money. The only laptops I ever had that rivaled my MacBook Pros in longevity were the pre-Lenovo ThinkPads, which were ALSO often maligned as being overpriced. LOL.
(Candidly, I think THAT might have been true -- I had a ThinkPad back in the 90s that was so over-built that it was still solid and perfect WELL after its last point of technological viability, and in an era when "well, just put Linux on it and use it for something else" wasn't really an option yet. Great laptop for about 3 years though.)
> Whether or not the rules in the App Store are "capricious" is widely debated, but it's probably safe to say that they're coming out looking pretty good vis a vis malware and end-user experience as a result.
Apple's walled garden certainly has its benefits. It's like a benevolent dictatorship, that is occasionally heavy-handed and is not always consistent.
> People who dislike Apple love to say things like this, but I've never really seen anything that qualifies. Is Apple stuff more expensive? Yes. But you tend to get more for your money.
For accessories? There is literally no reason for Apple to put DRM on their lightning connector interface other than to lock out unlicensed accessories and charge exorbitant prices for Apple replacements. Even something simply like an A/C adapter for an iPad is like $40. You really aren't getting more for your money in that case.
Apple's hardware is usually excellent and worth the price of admission. My Macbooks were the best computers I've ever owned.
Not sure how one can say brave stole anything. Pretty sure i use their browser for free and buy my BAT on my own doing. And give it to publishers on my own doing
I think both Github and Cloudfare are former cherished underdogs, both of which have undergone the first-phase conversion to "no longer underdogs but still widely appreciated". We'll have to see how they both fare post-acquisition/IPO.
Get large enough and you will run afoul of anyone's morals.
this is not excusing the issues at hand but people still tend to censor their offense based on non rational criteria; see the pass that Apple gets with China/Russia all because lots of people like their phones.
I think part of the problem of a culture of "don't be evil" is that it's so easy to move the goal posts. Don't be evil under a utilitarian mindset (which 90% of America probably prescribes) is basically a form of moral relativism. Evil is relative.
> The vaunted free market that so enamours Silicon Valley and digital utopianists cannot avoid corrupting these companies’ moral cores, apparently.
I don't think it was the free market which corrupted their moral cores; it was their leaders’ and employees’ corruption which corrupted the companies’ moral cores — and the free market was insufficient to prevent that corruption.
Who are "the" technorati? Are you talking about actual individuals who changed their minds, or a general "group"? If the latter, the contradictions are based mostly on that.
Google had goodwill and fooled a lot of people for a bit there, sure, but that was over 15 years ago -- and when were Microsoft, Apple or Facebook known for their "moral core"? To whom?
I’m not saying it’s wrong (I actually think it’s fair), it’s just that the regularity is amusing. When Microsoft was represented by a Locutus-ified Bill Gates on Slashdot two decades ago, “do no evil” open-source champion Google could do no wrong,
I was about to write “oh, how far the mighty have fallen!” but upon closer consideration that would be the wrong epithet. It’s precisely because it has not fallen, and because it has become too mighty, that is now viewed with ever-growing suspicion.
The vaunted free market that so enamours Silicon Valley and digital utopianists cannot avoid corrupting these companies’ moral cores, apparently. Quite the opposite of the declared ethos.
EDIT: The cherished underdogs of today, if they do not succumb, regularly become the maligned monsters of tomorrow. It’s almost as if there’s something built into the system that corrupts them...